What to do with used pallets?
What happens to your pallets after they’ve been used for the first time? If you’re like most businesses, they are either stored, burned or disposed of after their first shipment. While it seems like an innocent mistake, this is a missed opportunity for your business for a variety of reasons – most convincingly though, you could be missing out on phenomenal cost savings.
What should you do with your pallets instead? Pallet recycling, of course. Insert them into a pallet recovery program so they can be reused for years to come. Recycling your pallets through a pallet recovery and repair program can help you extend the life of your pallets and cut your supply chain costs.
A pallet recovery system is a closed-loop system that allows you to cut costs and extend the life of your pallets through consistent pallet repair. As seen in the diagram to the right, it consists of a pallet management company retrieving used pallets after they’ve been used to deliver goods, delivering the pallets to a recycler for repair, and then shipping them back to the original manufacturer for reuse in another shipping cycle.
This process occurs over and over again until the pallets are no longer functional – which can take years. Extending the lifetime of your pallets and being able to trace them to their end destination points are just a couple advantages of many that accompanies pallet recovery systems. Keep reading to learn about more benefits associated with pallet recycling through a recovery and repair plan.
4 Benefits of Pallet Recycling and Recovery
1. Cut Costs.
When you begin a pallet recovery program, you instantly diminish your need to constantly purchase new pallets because you have an ongoing, incoming pallet inventory – depending on how many pallets your business handles on a regular basis. By using refurbished pallets in place of new pallets, you’ll maximize your investment and prevent your company from overspending on packaging needs.
For example, one of our clients has been taking advantage of our pallet recovery, repair, and return program for more than eight years and has saved in excess of 25 percent per pallet through our partnership. How? Keep reading for a quick rundown on their savings.
Pallet Recovery Case Study
This company (we’ll refer to it as Client A) required large customized pallets, which cost approximately $65 per new pallet. Client A regularly uses these pallets to transport their large goods to a variety of locations across the country.
Once the goods are shipped, we wait for their distributors to collect 30 or more pallets, and then we retrieve them and bring them to our pallet recyclers where they are refurbished or disposed of (if necessary). Once the recyclers collect 120 recycled pallets, we return them to Client A for reuse. By allowing us to consistently repair their pallets, Client A is able to expand the lifetime of the pallets, some of which have lasted throughout our entire eight-year partnership.
Final Savings: As we stated previously, Client A’s new pallets cost approximately $65. But, after the pallets are repaired, the costs come to $25 per pallet trip. Not to mention, at a two dollar depreciation rate over the pallet life cycle, most pallets are able to go through the recovery process for up to eight years.
**As seen in the case study above, odd-sized pallets are preferred in a recovery program because receivers and recyclers aren’t fighting over them. Also, odd, custom pallets are of a higher value which affords you the opportunity to transport them over greater distances than a standard 48×40.
2. Become More Sustainable.
At FALM, we are proud of our green initiatives and are happy to give companies an opportunity to move toward a more sustainable business model. Recycling pallets through a pallet recovery program will help your business become more environmentally friendly, which comes with many benefits of its own.
1. Appeal to new consumers.
Businesses that show they care about more than just profits are more attractive to today’s informed consumers and can also differentiate themselves from their competition. Research from the Natural Marketing Institute (NMI) has shown that 9 out of 10 consumers consider themselves “conscious consumers,” 87 percent of which are more likely to purchase from businesses that commit to environmentally-friendly practices. The research also revealed consumers are willing to pay up to 20 percent more for environmentally friendly products.
2. Increase your ability to comply with government environmental regulations.
As concerns about climate change and diminishing natural resources continue to grow, it’s likely the government will continue to implement environmental regulations to help reduce waste and preserve our planet. By taking steps toward a more sustainable business model, you’ll be prepared to easily adapt to any new federal or state requirements. Additionally, there are government grants available for businesses with “green” practices. To see if you’re eligible, check out Grants.gov.
3. Reduce waste.
Though this might seem like an obvious benefit, it’s a notable reason to consider a pallet recovery program. There are approximately two billion pallets currently in circulation in the United States, and without a pallet recovery program, those pallets would all take up valuable space in landfills – which would also increase your disposal costs.
Over the past 25 years, pallet recovery programs have grown exponentially. In 1992, only 51 million pallets were recovered, but in 2011 more than 474 million pallets were recycled or repaired. By implementing a pallet recovery program, your business can help ensure even fewer pallets make their way into landfills.
4. Improve employee retention.
Similar to consumers, employees are becoming more concerned with the “why” of their employer and are more engaged with their work when it’s connected to a “bigger cause.”
According to the 2016 Cone Communications Millennial Employee Engagement Study, 83 percent of millennials – the largest share of the American workforce – would be more loyal to a company that helps them contribute to social and environmental issues, and 88 percent say their job is more fulfilling when they are provided opportunities to make a positive impact on social and environmental issues.
With this in mind, moving toward a more sustainable business model can help you attract new talent and increase your employee retention.
3. Improve Safety.
Broken pallets are a safety hazard in the workplace. For workers who must handle broken pallets, there is an increased risk of puncture wounds, cuts, or dropping the pallet if a fragile board were to break during transit. There’s also an increased chance of the unit load tipping due to broken boards, which can not only lead to worker injury but also can damage the product being transported.
When pallets are consistently repaired in a pallet recovery program, you can rest easy knowing they are in good working condition throughout the shipping cycle.
4. Reduce storage space and meet sanitation requirements.
Having a closed-loop pallet system can reduce the storage space you need for pallets. Because your pallets are constantly being recycled and returned, you’ll have a safety stock that isn’t concurrently stored within your facility. This means you’ll have less yard/door space taken up by pallet inventory.
Pallet recovery systems can also help ensure your pallet inventory meets ISPM-15 requirements. When a heat-treated pallet is repaired, all new boards and stringers must be heat-treated as well to ensure they meet all government mandates. Our pallet recyclers can make sure all pallets are fully, properly heat-treated during the repair process.
Take Advantage of Pallet Recovery
Recycling pallets through a pallet recovery, return, and repair loop can turn an often overlooked aspect of your business into a major asset. Not only does it help to reduce waste in our world, but it also can help your business save money, improve workplace safety, and reduce storage needs. If your business regularly uses pallets, start reaping the benefits of pallet recovery today.